New wave of financial growth

Aug. 13, 2013

Jazmin Steinfurth helps a customer over the phone at her cubicle Monday at Capital One in Sioux Falls. The company plans to hire 175 works, which would place it among the top 10 companies in the city. / Joe Ahlquist / Argus Leader

Unemployment

Sioux Falls metro area

3.5 percent in June. South Dakota3.9 percent in June. United States7.4 percent in July. Source: Labor Market Information Center, South Dakota Department of Labor and Regulation and Bureau of Labor Statistics, U.S. Department of Labor.

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Capital One will hire 175 workers in Sioux Falls as the national credit card giant extends its rapid growth in the local economy.

“We are committed to building our workforce in Sioux Falls,” David Long, director for Capital One, said Monday. “Sioux Falls is a great location for our call center, and we are pleased to be bringing more high-quality jobs to the area.”

Capital One has about 900 workers at its credit card processing center at 2200 E. Benson Road. The new hiring would bring that total near 1,075. It would push the company into the top 10 of Sioux Falls private employers and top 12 overall when also considering public schools and city employees.

Most of the new jobs will be customer service phone representatives who fieldincoming calls about credit card accounts from around the country.

Capital One entered the market in late 2011 when it took over HSBC’s Sioux Falls operation. The company pledged then to keep the 400 HSBC positions and add 400 more. It met that goal and exceeded it by 100 in less than two years.

“That’s pretty dramatic. You don’t see that very often,” said Mary Medema, director of workforce development for the Sioux Falls Development Foundation and Forward Sioux Falls.

The new employees will be joining a national financial power. Capital One, with its home office in McLean, Va., is a top 10 bank with $209 billion in deposits, $296 billion in assets and 42,000 employees in the U.S., Canada and United Kingdom.

The surge in hiring here has come even as the company went through its transition and remodeled its building.

“They said whenever they had the opportunity, once the remodeling was done and they got everybody on the same system, they were going to try to fill the building,” Medema said.

The Benson Road building has seen big swings in employment since 2000. Specialized Card Services had 1,050 employees there then. It later was under the Household name, then HSBC, which peaked at 900 workers before dropping to 400, she said.

The upsurge will give Sioux Falls three financial operations with more than 1,000 employees, as Capital One joins Wells Fargo at 2,858 and Citi at 2,700. First Premier’s bank and bank card affiliate add another 935.

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The financial services sector has 16,400 jobs locally, or 11.4 percent of the total 144,000 in the metro area covering Minnehaha, Lincoln, Turner and McCook counties. That percentage was higher a few years ago, Medema said. Financial growth flattened recently, as medical and retail sectors grew. That trend alongside the recovery from the economic slowdown and 2008-09 recession make Capital One’s growth here notable.

“I think they came in with a very attractive employment package, a very positive brand,” Medema said. “They came in probably at a really interesting time where maybe a lot of folks were ready to enter or re-enter the market post-slowdown.”

That gave Capital One an edge in employment, she said.

“When you are the new organization in town, you kind of have one shot at that,” Medema said. “Knowing they were going to add 400 jobs meant there would be a variety of jobs in the call center. ... That causes some headaches for existing call centers that can’t claim that newness till the market settles down.”

Bill Adamson, associate professor of economics at South Dakota State University, said Capital One’s growth here reflects a national view that the state has “very favorable regulations for issuing bank cards.” While the growth is good employment news, reliance on consumer debt shows dismal habits that are particularly hard on low-wage and middle-class families, he said.

“It reflects that households don’t have a good pattern of saving. They are essentially living beyond their means when they’re financing daily expenses like food and gasoline on their credit card,” he said.

“The overall use of credit cards reflects a national problem. Growth here reflects a favorable business climate. If it doesn’t happen here, it’s going to happen somewhere else,” Adamson said.

Forbes named Capital One Financial Corp. one of its “100 Best Companies to Work For.”

In discussing the new jobs, Long said Monday that the company is “always on the lookout for top talent who can bring a variety of thoughts, ideas and backgrounds to serve our customers and help us continue to grow and succeed.”

Its announcement said the company is seeking self-starters with attention to detail who also “possess strong written and verbal communication skills.” In a sign of the times of health reform, the announcement added that workers “are offered comprehensive medical coverage including health, dental, vision and prescription discounts, as well as free preventive-care visits for employees and their families.”